Part D in the Nursing Home: GLP-1s Surge, Antipsychotics Persist, Biosimilars Stall

GLP-1 drugs are about to become one of the largest revenue drivers in LTC pharmacy, and most operators are not positioned for it. The class hit $22.3 billion in Part D spending in 2023. It is on pace for $35 billion by year-end 2025. Meanwhile, the antipsychotic volume that has anchored LTC rebate economics for a decade is under renewed CMS pressure, and the biosimilar wave that was supposed to reshape Part D never showed up.

We pulled five CMS datasets covering Part D spending (2019–2025), prescriber-level antipsychotic claims, MDS quality measures across 14,703 nursing homes, NADAC acquisition costs, and quarterly utilization through Q2 2025.

The Big Picture: Where Part D Dollars Go

Eliquis (apixaban) remains the single most expensive Part D drug at $18.3 billion in 2023. But the GLP-1 class, taken collectively, already exceeds it. Ozempic alone reached $9.2 billion, Trulicity $7.4 billion, and Mounjaro $2.4 billion in its second year on market. The class share of total Part D spending grew from 8.1% in 2023 to 9.6% in 2024 to 10.7% in the first half of 2025.

The GLP-1 Explosion: $22B and Accelerating

The average cost per GLP-1 claim is $1,369, roughly 7.7x the average Part D claim. For an LTC pharmacy filling 50 GLP-1 prescriptions per month, that is $822,000 in annual drug cost running through the adjudication system. The rebate implications depend on formulary position and manufacturer contracts, but GLP-1 rebates have historically been aggressive (30–50% of WAC for preferred formulary placement), making this a significant revenue line for PBMs and plan sponsors even as net cost to the system grows.

LTC-Specific GLP-1 Considerations

GLP-1 penetration in nursing home populations is lower than in community settings. Most LTC residents are dual-eligible, and state Medicaid programs have varied prior authorization requirements for GLP-1 agents. The diabetes indication drives most LTC GLP-1 utilization; the obesity indication (Wegovy, Zepbound) has limited applicability in a population where unintentional weight loss is a more common concern than obesity.

Antipsychotics: $7.2 Billion and Holding

CMS has spent over a decade pushing nursing homes to reduce antipsychotic use. The National Partnership to Improve Dementia Care launched in 2012. Yet the latest MDS quality data (measure 481, period 2024Q4–2025Q3) shows a national average of 16.71% of long-stay nursing home residents receiving antipsychotic medications. The median is slightly lower at 14.61%, but the 90th percentile sits at 29.6%.

The quarterly trend shows a modest decline of 0.60 percentage points over four quarters. That is not nothing, but after 14 years of the national initiative, rates above 16% suggest a floor. The low-hanging fruit was picked years ago. What remains is a population with genuine clinical need (schizophrenia, severe behavioral symptoms unresponsive to non-pharmacological interventions) and a population where prescribing persists out of habit, convenience, or staffing constraints.

State Variation Tells the Real Story

The spread between South Dakota (25.1%) and DC (8.6%) is 16.5 percentage points. That gap is not explained by patient acuity alone. It reflects differences in state regulatory enforcement, availability of behavioral health consultants, staffing ratios (facilities with better staffing use fewer chemical restraints), and prescriber culture.

Who Is Prescribing: Nurse Practitioners Lead

Part D prescriber data shows 13.1 million antipsychotic claims for beneficiaries aged 65+ in 2023, totaling $2.33 billion across 1.63 million beneficiaries. The breakdown by prescriber type reveals that nurse practitioners write 27.5% of all antipsychotic claims for seniors, more than any other provider type including psychiatrists.

The cost-per-claim gap is notable. Psychiatrists average $212 per claim, driven by higher use of branded long-acting injectables (Invega Sustenna at $1.82B, Abilify Maintena at $637M). Internists and family practitioners average around $100 per claim, reflecting generic oral antipsychotic prescribing (quetiapine, risperidone, olanzapine). For LTC pharmacies, the prescriber mix at each facility directly affects both drug cost and rebate yield per antipsychotic script.

Biosimilars: The Promise That Has Not Arrived

Total biosimilar spend in Part D in 2023: $199 million. That is 0.07% of total Part D spending. For context, Eliquis alone is 92x larger.

The adoption numbers are stark:

• Adalimumab (Humira): Biosimilars (Amjevita, Cyltezo, Hadlima) captured roughly $43 million vs. $6+ billion for Humira branded products. Biosimilar share under 1%.
• Insulin glargine: Semglee and other biosimilar/interchangeable products totaled ~$63 million vs. $5.9 billion for Lantus/Basaglar/Toujeo. Under 1% share.
• Infliximab (Remicade): The one bright spot. Biosimilars (Inflectra, Renflexis, Avsola) captured $42 million vs. $111 million for Remicade, a 27% share. But infliximab is primarily a medical benefit (Part B) drug, with limited Part D relevance in LTC.

Some biosimilars showed strong percentage growth (Semglee +569%, Nyvepria +240%), but from bases so small that the absolute dollar impact is negligible.

Top 10 Drug Classes: Spend and Claims

The table illustrates the two-tier Part D economy. The top seven drugs are all branded, averaging $950 per claim and generating the rebate volume that supports PBM and plan sponsor economics. The bottom three are generics with massive claim counts but minimal per-claim revenue. LTC pharmacies live in both worlds simultaneously: high-volume generic dispensing for margin, high-cost specialty dispensing for rebate participation.

Where the Money Is Moving

Every shift in drug mix creates winners and losers. Here is who is on which side of the current transition:

The structural problem for LTC pharmacies is clear: they are dispensing increasingly expensive drugs but capturing a shrinking share of the economics around those drugs. GLP-1 revenue flows to manufacturers and PBMs. Antipsychotic rebates flow to plan sponsors. The pharmacy is the pipe, not the pump.

What LTC Pharmacy Operators Should Do Now

Revenue Mix Is Shifting Toward Fewer, Costlier Scripts

GLP-1s at $1,369 per claim are replacing Trulicity volume (down 26% YoY) with Mounjaro volume (up 168%). The net effect is higher per-claim cost but potentially different rebate terms. LTC pharmacies that built rebate models around Trulicity’s Lilly contract need to reassess as Mounjaro cannibalizes from the same manufacturer but under different formulary economics.

Antipsychotic Rebate Revenue Has a Ceiling

The $4.5 billion in branded antipsychotic spend (primarily LAIs) is the rebate-rich core of LTC antipsychotic economics. With CMS maintaining pressure and the January 2026 refresh introducing a respecified antipsychotic quality measure using claims data instead of MDS self-report, expect tighter scrutiny. Branded LAI prescribing in facilities with high antipsychotic rates will draw more survey attention, creating regulatory risk for the highest-rebate prescribing patterns.

Biosimilars Are Not a Near-Term Rebate Play

At 0.07% Part D share, biosimilars are not yet a factor in LTC pharmacy rebate economics. The structural problem is that PBMs and manufacturers have not aligned incentives for biosimilar adoption in Part D the way they have (slowly) in Part B. Until formulary design forces biosimilar substitution or biosimilar manufacturers offer rebates competitive with originator products, LTC pharmacies should not model biosimilar conversion as a revenue opportunity.

Three Actions for LTC Pharmacy Operators

• Renegotiate GLP-1 rebate contracts now. If your rebate agreements are based on 2022-2023 Trulicity-dominated volume, you are misaligned with 2025 prescribing patterns. Mounjaro and Ozempic require separate manufacturer negotiations.
• Model antipsychotic revenue under CMS’s new claims-based measure. The respecified measure is harder to manage than the old MDS self-report. Facilities that have been “coding around” antipsychotic use on MDS submissions will see higher reported rates under the claims methodology, triggering more interventions and potentially reducing branded LAI volume.
• Do not chase biosimilar conversion for rebate purposes. The math does not work yet. If you are converting to biosimilars, do it for acquisition cost savings and frame it as a cost-reduction play, not a rebate play. The rebate upside is years away.

Every dollar of GLP-1 growth is a dollar that did not exist in LTC pharmacy five years ago. The operators who capture it will be the ones who renegotiated before the volume arrived.